Saudi-born businessman to take $24m battle with Lebanese bank to UK court

Bank Audi argues it cannot make the payment as a result of Lebanon's banking crisis

Bank Audi premises in Beirut. The institution has been told it must answer a case over a customer's $24 million claim in the UK. Reuters

A Saudi-born businessman has won the right for his battle to force a Lebanese bank to release $24 million of his funds to be heard by a court in the UK.

Sheikh Mohammed Omar Kassem Alesayi asked Bank Audi to transfer the money, held in eight accounts, to an account he held with the UBP private bank in Geneva in 2022 but the bank has refused.

The request came during Lebanon’s banking crisis, which began in 2019, and has resulted in banks refusing to make international transfers. Bank Audi has argued that almost all Lebanese banks have limited access to foreign currency which has significantly curtailed their normal operations.

Sheikh Alesayi, who was born in Saudi Arabia but is now a UK citizen, started proceedings against the bank in the English courts, seeking an order that the bank carry out the transfer.

His claim is based on decisions of the High Court in London that customers of Lebanese banks are entitled to international transfers based on the law of Lebanon, provided there is a sufficient balance.

Under UK law, a consumer living in the UK can bring a claim in an English court against a business that pursues commercial activities in the UK or directs such activities there.

Bank Audi denied that it directs commercial activities to the UK and argues the High Court has no jurisdiction over the dispute. The bank also argued that Sheikh Alesayi was not domiciled in Britain when he first opened his account in 1994.

Former central bank governor Riad Salameh is widely blamed Lebanon's economic collapse and its banking crisis. AFP

But Sheikh Alesayi argued that he should be considered as being domiciled in Britain since 2016, when he opened an account with the UBP, and was by that time living full-time in London.

As part of his claim, he told the High Court he has long-standing connections to the UK, dating to the 1970s. His father bought eight properties in the upmarket St John’s Wood area of London and gave them to Sheikh Alesayi and his five siblings.

From about 1990, he said he established a second home at the property and began regularly attending Regent’s Park Mosque.

The court was told that he bought a Bentley and had it delivered to the penthouse and also employed a chauffeur, which is indicative of permanent residency.

Sheikh Alesayi was granted indefinite leave to remain in the UK as a Tier 1 Investor in 2018. He was granted Settlement Status with Indefinite Leave to Remain in 2021 and then in 2023 he was granted British citizenship.

In his ruling, Judge Adam Constable said that “Sheikh Alesayi has a good arguable case that he was domiciled in London from around 2012 onwards” and that the High Court has jurisdiction in the dispute.

Lebanese banks imposed arbitrary restrictions on their clients in 2019 after the state failed to honour its bond commitments and the economy went into a tailspin. The Covid-19 pandemic forced the economic crisis to historic proportions.

Bank customers campaigning for depositors' rights in a protest in downtown Beirut. EPA

The possibility of Lebanese depositors soon gaining access up to $93 billion stuck in the country's banks is slim to none, financial analysts say, despite assurances from the Lebanese economy minister.

The economic collapse was blamed on decades of financial mismanagement and corruption by Lebanon's ruling elite. Former central bank governor Riad Salameh has also been accused of helping to embezzle hundreds of millions of dollars from the central bank.

A subsidiary of Bank Audi, Banque Audi (Suisse) SA, is one of several banks suspected of sheltering the money allegedly embezzled by Mr Salameh.

A Swiss financial regulator last year found that Banque Audi (Suisse) “breached its obligations in the prevention of money laundering” and “seriously violated financial market law”.